The Great British TV Sell-Off: who owns the UK's favourite shows?
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Version 0 of 1. Does it matter that the UK commercial TV sector, following the pattern of other British industries such as car manufacturing, is now largely in foreign hands? Sajid Javid, the culture secretary, seems to have no problem with it. He recently told a TV industry conference that US ownership of UK TV producers and broadcasters was “no bad thing” and a “massive vote of confidence” in the UK creative economy. “To me that is a massive vote of confidence in the work you do – work that has had an incredible impact on the UK economy. Last year the UK television industry generated more than £12bn of revenues. Indies and superindies are worth £3bn [and] British multichannel broadcasters turn over more than £5bn a year.” Javid was responding to Channel 4 chief executive David Abraham’s MacTaggart lecture at the Guardian Edinburgh International Television festival in August, in which he warned that the UK independent production sector is being “snapped up almost wholesale” and 2014 could mark the “peak year of the gold rush of British television” with foreign media companies, mainly from the US, on a spending spree. Abraham urged politicians and regulators to act decisively to “update and strengthen” the UK’s public service broadcasting system, as the BBC and Channel 4 were the only bulwark against a broadcasting industry dominated by US media moguls such as Rupert Murdoch and Virgin Media owner John Malone and even larger technology firms. “This special [TV] landscape of ours did not happen by accident. So we should not assume that, left purely to the market, it will continue to thrive. If you care about creativity, speak up and speak up now. Stay silent and our special system may wither. Once gone, it will never come back.” He was speaking after a busy year for mergers and acquisitions activity in the UK TV industry with MTV owner Viacom buying Channel 5 from Richard Desmond; John Malone’s Liberty Global and Discovery Communications jointly acquiring All3Media (Derren Brown, The Only Way Is Essex, Shameless) and Liberty also acquiring BSkyB’s 6.4% stake ITV. Rupert Murdoch’s 21st Century Fox also hatched an agreement with US private equity firm Apollo Global Management to put Endemol (Big Brother, Pointless, Ripper Street) and Shine (MasterChef, Broadchurch, One Born Every Minute) into a joint venture. As a result of this M&A activity, seven of the 10 biggest UK TV producers - leaving aside the BBC and ITV - are now in foreign ownership, according to the recently published Televisual Production 100 survey for 2014, and City analysts are tipping the UK’s largest advertiser-funded broadcaster to be in foreign ownership within five years. This means that while most of our favourite TV shows are made by British creative teams, working for UK-based production companies, an increasing number are ultimately foreign-owned. What does this mean in practice? We’ve created an interactive of the evening schedules (6pm-10pm) for the five main terrestrial channels on a recent Monday night – 22 September. Scroll over individual programmes for the producer and ultimate owner. We also looked in slightly more depth at the same time period, for the same five channels – BBC1, BBC2, ITV, Channel 4 and Channel 5 - over the seven days 22-28 September, and compared the data with the equivalent week in September 2004. It is just a snapshot, admittedly, but highlights the impact of the trend towards foreign ownership of UK production companies over the past decade. The percentage of UK-owned shows has declined only marginally, from 72% to 66%, a reflection of the BBC, ITV and ITN’s still prolific soap and news output. However, the proportion of programmes ultimately owned by US companies has doubled in the same period, from 10.6% to 22.3%. A decade ago most US-owned output on the main channels consisted of American imports - Friends, Will & Grace, The West Wing, Charmed, CSI: Miami, Hollywood movies. Now there is a greater proportion of UK-produced programmes ultimately owned by US companies: Hollyoaks, Who Do You Think You Are?, Downton Abbey. The proportion of output ultimately owned by German media conglomerate Bertelsmann has declined as a result of the changing fortunes of Fremantle Media’s stable of UK production companies. A decade ago they were making Channel 5 soap Family Affairs and The Bill for ITV, both now cancelled; and were a major beneficiary of broadcasters’ apparently insatiable appetite for property programming (House Doctor, Property Ladder) as the housing boom gathered pace. A constant in the graph is Channel 5 soap Home and Away: now, as then, on five nights a week and produced by Australian broadcaster Seven Network. We arrived at the market share graph by analysing the producer of each peaktime show in 2014 and 2004. Unsurprisingly the BBC, with its large in-house production operation, comes out on top now and then, followed by ITV and ITN, producer of news bulletins for ITV, Channel 4 and Channel 5. However, the growth in foreign ownership of what was formerly known as the “independent” sector is highlighted in that three of the most prolific producers in 2014 are UK companies – Remarkable Television, Lime Pictures and North One Television - which are ultimately by US firms (21st Century Fox/Apollo in the first instance, and Liberty Global/Discovery Communications in the other two). Hollyoaks and The Only Way Is Essex producer Lime Pictures provides a case study in how the consolidation of the UK TV production section over the past decade or so has led to a point where most of the larger producers are no longer truely “independent” and in foreign ownership. Lime began life as Mersey Television, set up by Brookside producer Phil Redmond in 1982. It was one of the first wave of TV production companies launched in the 1980s to supply Channel 4, set up as a publisher/broadcaster with no in-house production and a specific aim of nurturing the UK independent sector. Redmond sold Mersey to All3Media, a so-called “superindie” set up by former Granada executives, in 2005 for about £35m and it was renamed Lime Pictures the following year. All3Media was formed in 2003 after buying Chrysalis Group’s TV production business, renamed North One Television, for £45m. As well as Mersey TV, it subsequently snapped up other independent producers including Bentley (Midsomer Murders), Company Pictures (Shameless, Skins, Wolf Hall), Objective (Derren Brown, Peep Show, Fresh Meat), Optomen (Ramsay’s Kitchen Nightmares, Two Fat Ladies) and Studio Lambert (Gogglebox, Undercover Boss). In 2006 All3Media sold a majority stake to London-based private equity firm Permira Funds, which sold out to Liberty Global and Discovery earlier this year as the company passed in to US ownership. The Mersey/Lime/All3Media story follows a familiar pattern in terms of the UK independent programme-making sector’s consolidation: TV producer cashes in on their creative endeavours by selling to larger company, which in turn brings in private equity backing or floats on the stock market to provide funds for further expansion, followed by a sale to media conglomerate, often foreign-owned. Which brings us to the present day, where according to the Televisual survey of the UK’s production sector for 2014, only three of the 10 biggest companies are still UK-owned – Question Time producer Tinopolis (which has just put up a for sale sign); Twofour Group, the firm behind Educating the East End; and Avalon Group, which makes Russell Howard’s Good News and Not Going Out. |